TMI Blog2019 (5) TMI 1446X X X X Extracts X X X X X X X X Extracts X X X X ..... In the case of Principal CIT vs Rasoi Ltd. [ 2017 (2) TMI 863 - CALCUTTA HIGH COURT] . In view of the aforesaid legal position we direct the Assessing officer to examine the assessee`s own funds and reserves and if the AO finds that the interest free funds were sufficient to meet the investments, no disallowance would be made under Rule 8D(2) (ii) of The Rules. As far as Rule 8D(2)(iii) of the Rules is concerned, it has been held in the case of DCIT vs REI Agro Ltd. [ 2013 (5) TMI 582 - ITAT KOLKATA] that it is only the investment which yielded tax free income that should be considered for working out the average value of investment while applying the Rule 8D(2)(iii) of the Rules. This order of the tribunal has been confirmed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pertaining to assessment year 2013-14, is directed against the order passed by the Commissioner of Incometax (Appeals)-3, Kolkata in Appeal No. 11405/CIT(A)-3,Kol/Ward-8(3)/16-17 ,dated 28-06-2018, which in turn arises out of an order passed by the Assessing Officer u/s. 143(3) of the Income-Tax Act, 1961 (in short, the Act ), dated 28- 03-2016. 2. Grounds of appeal raised by the Assessee are as follows:- 1. That the Ld CIT(A)-3 grossly erred in fact as well as in law in confirming the addition of ₹ 99,774/-/- made by the Ld AO u/s 14A read with Rule 8D. 2. That the Ld CIT(A) - 3 Kolkata erred in fact as well as in law in confirming addition of ₹ 15,83,078/- on account of interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.633 of 2016 judgment dated 15.02.2017. In view of the aforesaid legal position we direct the Assessing officer to examine the assessee`s own funds and reserves and if the AO finds that the interest free funds were sufficient to meet the investments, no disallowance would be made under Rule 8D(2) (ii) of The Rules. As far as Rule 8D(2)(iii) of the Rules is concerned, it has been held by the Coordinate Bench of ITAT Kolkata in the case of DCIT vs REI Agro Ltd. in ITA No.1811/Kol/2012 dated 14.05.2013 that it is only the investment which yielded tax free income that should be considered for working out the average value of investment while applying the Rule 8D(2)(iii) of the Rules. This order of the tribunal has been confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered the same. We note that details as filed by the assessee have not been considered in any of the two proceedings i.e. neither before the AO nor before the ld.CIT(A). Therefore, we deem it fit and proper in this peculiar facts and circumstances that larger interest of justice would be served in case ld. AO decides the entire issue once again taking into consideration the details which already submitted by the assessee before him. We also direct the assessee to submit the evidences/explanation to prove its boanfide. Ground no. 2 raised by the assesse is allowed for statistical purpose. 8. In the result, the appeal of the assessee is allowed for statistical purpose. Order pronounced in the open court on this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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